Tempo Industries is an 80%-owned subsidiary of Dalie Inc.On January 1, 2017, Dalie leased an asset to Tempo and the following journal entries were made:
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The terms of the lease agreement require Tempo to make five payments of $5,000 each at the beginning of each year.The implicit interest rate used by both Dalie and Tempo is 8%.
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Required:
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Prepare the eliminations and adjustments required by the intercompany lease on the Figure 5-9 partial worksheet of December 31, 2017.Key and explain all eliminations and adjustments.
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Question

Tempo Industries is an 80%-owned subsidiary of Dalie Inc.On January 1, 2017, Dalie leased an asset to Tempo and the following journal entries were made:
?
?
  The terms of the lease agreement require Tempo to make five payments of $5,000 each at the beginning of each year.The implicit interest rate used by both Dalie and Tempo is 8%.
?
Required:
?
Prepare the eliminations and adjustments required by the intercompany lease on the Figure 5-9 partial worksheet of December 31, 2017.Key and explain all eliminations and adjustments.
?
?

Quizplus · Accepted Answer

The Answer of Tempo Industries is an 80%-owned subsidiary of Dalie Inc.On January 1, 2017, Dalie leased an asset to Tempo and the following journal entries were made:
?
?
  The terms of the lease agreement require Tempo to make five payments of $5,000 each at the beginning of each year.The implicit interest rate used by both Dalie and Tempo is 8%.
?
Required:
?
Prepare the eliminations and adjustments required by the intercompany lease on the Figure 5-9 partial worksheet of December 31, 2017.Key and explain all eliminations and adjustments.
?
?

Tempo Industries Is an 80%-Owned Subsidiary of Dalie Inc